Politics and Government

Paid leave is now Minnesota law: What you need to know

Woman smiles as she wears giant foam finger
As Gov. Tim Walz talks about signing a paid family and medical leave law, Lt. Gov. Peggy Flanagan shows a prop to reporters at the Capitol on Thursday.
Brian Bakst | MPR News

Updated 3:15 p.m.

After years of consideration, Minnesota will start ushering in a paid family and medical leave program that doesn’t depend on where a person works.

Gov. Tim Walz signed the legislation Thursday, capping a hard push that previously ended in letdown and became a reality after narrow passage by Democratic majorities this year.

“Paid family and medical leave seemed like a pipe dream for 10 years. It seemed like— why can other people have this and we can’t?,” Walz said before signing the bill. “We've got a little bit of a glide path here, but I have to tell you, when I'm talking to Minnesotans, they want this and they want it now. They want to get it done.”

Walz and other supporters insist it will bring financial security to more families when work isn’t an option due to a major circumstance.

Business groups fought the requirement, saying it will add an expensive administrative burden and in some cases duplicate or fall short of what’s offered now in the marketplace.

Here are some details about how the program is expected to work.

What situations could be covered for an approved leave?

There are many that would count. 

The most common might be bonding time around a child’s birth, adoption or foster care arrangement so long as it is used within the first 12 months of that event, with few exceptions. 

Caregiving leave could apply to a family member’s serious physical or mental illness, an injury that leads to impatient care or incapacity, their need for recurring treatment or a stretch of recovery.

Similar parameters apply to the employee’s own medical situation, including pregnancy or health complications.

Leave could also stem from a family member’s military deployment or a need to reconnect with someone coming back from active-duty service. The leave could surround an instance of domestic abuse or sexual assault to the employee or a family member in cases where the need for time away from a job isn’t expected to be brief.

People would be assured their prior job or an equivalent one upon their return.

Are there limits on who counts when the leave is for bonding or caregiving?

The law is specific about who fits the bill.

It covers:

  • a spouse or domestic partner.

  • a child where the applying worker is the parent, legal guardian or defacto parent. Sons-in-law or daughters-in-law count.

  • a sibling.

  • a grandchild, grandparent or spouse’s grandparent.

  • a person where there is a clear reliance relationship regardless of whether there is a family tie or housing connection.

How many weeks could somebody be away from their job?

That depends, but it maxes out at 20 weeks in a calendar year (based on the employer’s benefit year) for a combination of events. Any single event is capped at 12 weeks.

Architects of the proposal predict most applicants won’t get near the maximum. But people could if they take 12 weeks for a bonding leave and then eight more to deal with a serious health bout, for example.

Not all of the leave would have to be taken consecutively. A person who needs to be away for regular health treatments could work out a schedule where leave is taken days here and there for a stretch of time. 

Applications for leave along with some kind of certification of the qualifying event would be submitted through a state-developed system and managed by the government.

How is the level of pay determined?

There is a scale that factors in a person’s wages and the state’s average weekly wage.

In 2022, the average weekly wage was $1,287.

Those who make less than 50 percent of the state’s average wage would see 90 percent of their regular pay. Somebody who makes more than that but not quite the state average would get two-thirds wage replacement. People earning more than the state average would get 55 percent.

Employers would be permitted to top off the wages of their workers but wouldn’t be required to. 

Who will pay for it?

The first burst of money to set up the program was taken from the state’s budget surplus, about $670 million.

Eventually, the costs will be split among companies and their workers. The payroll tax, described as a premium in the bill, begins at 0.7 percent. The rate could go up but not until January 2027 and not above a maximum of 1.2 percent.

There are exceptions to lower the cost for companies with fewer than 30 workers.

A company could opt out if it offers a leave benefit that meets or exceeds the new state standard.

There is also money allocated to help employers hire temporary staff or pay costs associated with employees on leave.

People who are self employed or are independent contractors could buy into the system as well.

When do those charges and the benefits start?

The premiums would be assessed beginning in January 2026, the same time at which benefits are set to be available.

Evan Rowe, deputy commissioner at the Department of Employment and Economic Development, said there is a lot of work to do before the launch.

“There are some significant systems that we have to deliver to be able to deliver the benefits in a timely, accurate manner,” Rowe said. “We're not the first to do it. And so we're going to learn from other states. I think what lessons that other states might have had to learn the hard way, we can learn the easy way, and and we're going to deliver a great program that I think that Minnesotans will be able to count on.”